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Approximately 118 countries around the world have been assessed on their level of compliance with the international standards on anti-money laundering and combating the financing of terrorism (AML/CFT) since 2004[1] . This includes 24 developing member countries (DMCs) of the Asian Development Bank (ADB)[2] . This paper examines the level of compliance of these DMCs, particularly the areas where the compliance level is more limited[3] . It goes on to compare the DMCs' compliance level with that of member countries of the Financial Action Task Force (FATF), which are typically developed countries and collectively responsible for developing global policy and standards for AML/CFT. It then considers factors pertaining to the level of compliance of these DMCs and areas of improvement.
1 Background to the international standards for AML/CFT and their assessment
The principal international initiatives in the development of international law and standards in AML/CFT involve the work of the United Nations (UN) and the FATF[4] . At the UN level, four conventions were adopted by the UN General Assembly, namely the Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988), the International Convention for the Suppression of Financing of Terrorism (1999), the Convention against Transnational Organised Crime (2000) and the Convention on Corruption (2003). Sanctions targeted at terrorism-related assets were also adopted by the UN Security Council pursuant to Chapter VII of the UN Charter, notably Security Council Resolution 1267 (1999) (and related resolutions) and Security Council Resolution 1373 (2001).
At the non-UN level, the principal initiative is the adoption by the FATF of the FATF 40 Recommendations on Money Laundering (FATF 40 Recommendations) in 1990 and the FATF Special Recommendations on Terrorist Financing (Special Recommendations) in 2001, and their respective revisions. They are commonly referred to as the FATF 40+9 Recommendations (FATF Recommendations).
Whilst the FATF Recommendations are not international law instruments, there are substantial linkages in the substance and underlying policies of these recommendations and the UN conventions and UN Security Council resolutions[5] . In particular, the FATF Recommendations reinforce the requirement that offences of money laundering and financing of terrorism be formulated in accordance with the UN conventions. The FATF Recommendations also require countries to implement targeted sanctions in line with UN Security Council Resolutions 1267 and 1373.
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